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Showroom7561 ,

Are restaurants just poorly managed, or is there another reason why they can’t pay their employees a living wage when their markup is like 400-1000%?

batmaniam ,

Restaurants have notoriously thin margins. I’m not defending this bill, and there are definitely awful practices out there, but it ain’t easy. Even a $34 dollar steak only kind of covers all the ancillary costs that make it happen.

The biggest issue with the crunch we have going on is that food (prepared or otherwise) should be way more expensive, and that shouldn’t be an issue because most people should be making way more money. All of those should/shouldn’ts got way out of whack over the course of decades, and the circus only continued because people found crappy ways to keep it going.

It’s a lot of industries. Construction is a great example. The developers make money. The material vendors make money. The builders make money. The sub contractors who actually put the parts together get haggled on invoices and take the lower amount because they have payroll to make and equipment loans to pay. Loans that are happily given out because the equipment can be easily repossessed.

It’s a very good thing everything is correcting, but it’s going to be an ugly process as workers get their due and pass the burden on to the small business owners.

Kage520 ,

I worked at a pizza shop way back ages ago (early 2000’s), but I think the formula is generally the same. Food costs they would shoot for 33%, labor ended up being around 33%, the rest was overhead for the facility (rent, AC, etc) and profit.

I think that’s actually a pretty fair amount of profit in that. But that was almost 20 years ago. I feel like the formula is likely similar though.

batmaniam ,

So way late, but no that’s shifted a lot. This is anecdotal but does speak to a lot of industries: my understanding is that pizza shops now live or die by cheese prices.

Labor, while fluctuating, doesn’t move a ton month to month. Dairy can.

That’s like I said anecdotal, but broadly, real-estate, equipment purchase/finacince has all been so hyper optimized it squeezes the business owners out.

It doesn’t matter the market. PIZZAOVEN-XL will sell it to you, let you leverage payments against your home equity, grab it back and resell it. They can deal with the cash flow issue. They are “assembled in America”. They don’t care if you go out of business. They’ll do it again for the same person that moves into the same space trying to do the. Exact. Same. Thing.

And I’m not trying to draw a blanket statement across all industries. I’m just saying the wheels that make every industry move are smarter and literally longer lived than anyone starting out, and there’s a reason “John deer” and “John deer finance” are seperate companies.

snooggums ,
@snooggums@kbin.social avatar

Sounds like sit down restaurant menus should reflect the actual costs including waitstaff then like any fast food place is able to do.

DAMunzy ,

Wait staff with tips get more than fast food restaurant employees though

HeyThisIsntTheYMCA ,
@HeyThisIsntTheYMCA@lemmy.world avatar

That’s a great argument for the manager/owner to do a shit job

Frostbeard ,

Cheap sub contractors need so much constant control to make sure things are delivered on spec that it is almost like it costs more than to hire the more expensive company with a reputation for solid work

RubberElectrons ,
@RubberElectrons@lemmy.world avatar

Saw exactly this when I was doing commissioning for a large municipality. No matter how tight the specs were, some of these knuckleheads would do it their own way and get mad when we forced them to do it right.

Some of them would just claim bankruptcy if the mistake was big enough.

Pro-tip, friends: don’t pick the lowest cost of construction bids, I guaran-fucking-tee it’ll cost you more than you saved. And, anyone who says they “meet code” is really saying they do the bare minimum required.

Showroom7561 ,

Restaurants have notoriously thin margins.

Help me understand.

Assuming restaurants have the same overhead as any other business: rent, staff, insurance, maybe equipment (manufacturing, etc.), what else?

They don’t have expenses like vehicles, tariffs on imported goods, the cost to fly staff out for conferences, tech costs, and so on.

The only difference is the product they bring in, and the product they put out.

As a consumer, who doesn’t get the benefit of industry discounts or high-volume prices, making food is really inexpensive.

When I see a restaurant, for example, selling pasta with marinara sauce for $15-20 a plate, I’m curious to know why they have to beg to cover costs. You can make the same dish for a family of four for under $3, and save $100 you’d spend getting the same dish at a restaurant.

So, again, if the cost of ingredients allows for such a significant markup, well beyond what most other businesses are able to get away with, why are restaurants having to charge “service fees” on top of tips?

ShaggySnacks ,

It’s the behind the scenes that cause a lot of the markup. There might be only two or three food service providers in your area. Food Service Company A has the same prices as Food Service Company B and C. There is no real competition to force prices down for restaurants.

If you are a franchise restaurant, you have to pay franchise fees, buy your all products from the franchise, work within the certain parameters, etc. There is no real way to find ways to drive down prices since your prices are set by the franchise through the prices of the product, corporate oversight, etc.

Showroom7561 ,

Great points!

batmaniam ,

So I’m stretching it a bit because at the end of the day this really does apply to more than restaurants, but the other commenter had it right.

Things like rent, insurance, etc go into the cost for well above the plate. So the ingredients are one thing, but you have to make up the cost of rent, paying the staff when there’s low customer volume, all the insane amount of costs that go into running a business. That server has to make up for the cost of printing menus and delivering them by mail.

None of this is the servers fault, who should get a fair wage, but it all adds up in a way that makes it hard for the owner. In fact, the person who sold them the grills, refrigerators, and all the other equipment, knows exactly and empirically how hard it is and sets their prices accordingly.

And it’s not like that company’s delivery drivers, techs, and fabrication workers also don’t deserve a wage. Or the Tyson folks that are plucking the chicken delivered.

The issue is, at the end of the day, those companies probably should be less profitable. But instead of accepting that, we put all of the companies that make all the stuff that run that restaurant into bigger companies that are now part of mutual funds, and they sell it out knowing they can grab it back if it goes under.

So you might be able to get away with making a few plates and some money, but trying turning it into something that will let you pay your rent and put your kids into a school. “Bob’s Burgers” is pretty true to life.

ApexHunter ,

This is how to tell someone you haven’t checked grocery prices lately without actually telling them you haven’t checked grocery prices lately. A box of mediocre pasta alone is going to cost you $1.75. A jar of Preggo will run you another 2.50. So 4.25 for an I hate life spaghetti and marinara meal.

The sauce they make probably doesn’t come out of a jar of reconstituted tomato paste and dried seasonings either.

If you buy decent ingredients you are looking at $3 for the pasta and $9 for the sauce. Or $12 for an “ok for a home cook” spaghetti meal with no protein.

Restaurant serving sizes (for better or worse) are usually 2x+ larger than you would serve at home. Rent isn’t free for the restaurant either. Or labor. Or utilities. Or equipment. Etc. General rule of thumb is that a restaurant needs to charge 3x raw food costs to cover expenses.

So your I hate life pasta would need to be priced at $6.50 and your ok for home but not something I would be happy with getting at a restaurant pasta would need to be priced at $18.

Showroom7561 ,

This is how to tell someone you haven’t checked grocery prices lately without actually telling them you haven’t checked grocery prices lately.

I’m going to assume you don’t cook at home.

No restaurant worth eating at buys packaged pasta, or packaged bread/buns, or canned sauce.

Flour is cheap, like really cheap. If a restaurant is buying real ingredients, then they are spending pennies and charging tens of dollars.

Restaurant serving sizes (for better or worse) are usually 2x+ larger than you would serve at home.

I highly disagree. I’ve never left a restaurant “full”, even after spending enough to buy a months worth of real food ingredients.

Rent isn’t free for the restaurant either. Or labor. Or utilities. Or equipment. Etc. General rule of thumb is that a restaurant needs to charge 3x raw food costs to cover expenses.

This I agree with. Is rent, labor, equipment at a restaurant significantly more than other places of work? Paying min wage doesn’t exactly eat through your margins.

ApexHunter ,

That whooshing sound, in case you were curious, was the point sailing right over your head.

corship ,

It’s simple, if a restaurant adds something to the bill I did not agree to beforehand I’ll never eat there again.

BassaForte ,
@BassaForte@lemmy.world avatar

If a restaurant adds something to the bill I didn’t agree to beforehand, I’m not paying.

corship ,

That would be consequent, but usually it’s not worth the trouble.

I’d rather leave with 20 quid less than wasting 30 min of my time.

LemmyFeed ,

So your time must be worth 40/hour or more to make it not worth the trouble?

Lupus108 ,

Not OP but my nerves are definitely worth more than 20 bucks.

Mango ,

Mine too. I have the nerve to tell them to fuck off with their bullshit.

corship ,

It’s a risk reward analysis and not strictly a 1:1 hour pay relation. No one guarantees you any positive outcome here.

Best case I get the fee removed after a short conversation.

Worst case, I have to engage in a long drawn argument still having to pay full afterwards.

Or anything in between, such as still having to pay full, but they’ll make this clearer in their menu.

best case was a simple mistake and I just have to ask politely. This can be considered very unlikely in this case because the recipient has a dedicated section for the fee, indicating that they’re not going to make any change to the bill. So the risk reward is highly leaning towards the worst case as the expected outcome.

AeroLemming ,

I’m pretty sure it’s illegal for them to try to make you pay the service charge you didn’t agree to.

corship ,

Surprise surprise, People attempt illegal things all the time

Neato ,
@Neato@kbin.social avatar

That's like $80k a year. Not that much.

NightAuthor ,

Literal poverty washes in SF

fushuan ,

My time is worth way more than 40/h when I’m out with friends trying to have a good time. I’m never going to the restaurant again and that’s it.

ColeSloth ,

Oh. It wouldn’t take me nearly 30 minutes. It would be less than 5 total minutes.

Hamartiogonic ,
@Hamartiogonic@sopuli.xyz avatar

How about just leaving the correct amount of cash on the table and walking away without saying a word.

snooggums ,
@snooggums@kbin.social avatar

I have never eaten at a restaurant that did not disclose a mandatory gratuity ahead of time, but I suppose it could happen.

alignedchaos ,

That’s wonderful for you, but it does happen.

Frozengyro ,

They should have it listed somewhere in large print and/or verbally inform people so patrons are aware ahead of time

jasondj ,

Went out to a pizza place the other night. Thought it was a brewery (one of my favorite local brews, actually), and had been there before and enjoyed flights from them…only to find out the place was a joint between the brewmaster and the restaurateur. Brewmaster took his share, his recipes, and dipped a couple days prior.

Anyways while the food was pretty good, I mostly went for the beer and that’s a big part of why I won’t go back (they only had a couple cans from the brewery left and nothing on tap, only some other regional breweries).

But the other part is that my wife put a tip down on the slip for our party of four (us and two kids) and asked me to doublecheck her math. I thought it seemed high and it turned out they already put a tip on the bill. For a party of four. Never saw that before.

phillaholic ,

Yea they better have this charge displayed very well on the menu

SoccerGod ,

Shit on their bathroom bro

SeaJ , (edited )

I don’t return to restaurants that pull this bullshit. Raise your menu prices to provide a living wage or take a hit to your profits.

Snipe_AT ,
@Snipe_AT@lemmy.atay.dev avatar

deleted_by_author

    •
    AnxiousOtter ,

    Ya this. The extra 18% should be baked into the menu pricing so that at least the cost is known up front. This is kind of like sneaking it in.

    DacoTaco ,
    @DacoTaco@lemmy.world avatar

    As a european, not knowing and legit asking: isnt that the thing all over the usa? I mean, you pick up something at the store, go to the counter and then SUPRISE, tax is added on top of the price. Like, that also feels like sneaking in extra costs?

    Drivebyhaiku ,

    Basically. People just get used to the nebulous mental calculations of how much tax one can expect. It encourages a culture of routine overspending and should be illegal.

    People expect to budget roughly tax and tip, they are basically mad because this is not a cultural norm and they got stung by surprise.

    SeaJ ,

    A sales tax is expected in most states and is generally fairly similar within each state and almost never come to more than 10%. That also pays for services that most people use.

    This extra charge at this restaurant is not common nor is it expected. They also set it at 18% which is a standard tip rate but specifically say it is not a tip. They claim it is to provide decent wages but considering they still allow tips (some places do this but do not allow tipping on top) , that pretty obviously is not true. This is just a bullshit tactic to have prices seem lower than the menu price.

    albert180 ,

    Yes, we have sales tax too. It’s just stupid that it isn’t included in the sticker price

    SeaJ ,

    Sales tax is fairly rare outside of the US. Most countries have a value added tax instead. The end result is largely the same but a VAT has fewer incentives to skirt it.

    DacoTaco ,
    @DacoTaco@lemmy.world avatar

    Sale tax is everywhere. And still, if its a static amount per state, why not include it on the sticker price so you know exactly how much you will be paying?

    Inventory and sticker work is done by computers, they know the price …

    SeaJ ,

    Believe it or not, some states do not allow that to be included on the sticker price since the sticker is there to note the price of the item. The sales tax is a tax on the transaction. You could probably note both but that might confuse dumb people.

    DacoTaco ,
    @DacoTaco@lemmy.world avatar

    Thanks for the info! Ye, i think vat would be better too

    SeaJ ,

    Yes, prices on each item should increase. This is just a sneaky way of avoiding doing that. A bunch of dick head restaurant owners tried doing shit like this when my city passed a law making $15/hr the minimum wage with no exemptions for tipped workers. Restaurant owners like Tom Douglas had to raise prices but didn’t want to so they tacked on an extra fee and claimed it was a living wage fee but you were still expected to tip just as much. If I was certain that money was actually going to workers, I might be okay with it but there is nothing forcing them to give it to workers. Also, it is straight up admitting that you were paying starvation wages before.

    People expected tons of restaurants to close after the minimum wage went up. None really closed and prices are fairly similar to most large cities. Some place did love to a no tip model with higher prices but generally it has been the same where you to 18-20% on the cost of the bill.

    s_s , (edited )

    So, restaurants might do this to avoid the cost of printing new menus with new prices.

    Much easier and cheapers to just print signs at the table, especially if you think prices will go up again soon.

    But this looks like they’re trying to screw you.

    PhlubbaDubba ,

    That’s literally what they did and you just posted this comment flipping shit because they had the audacity to tell you it was going to the workers.

    Marin_Rider ,

    even in countries that actually pay their staff right, there’s no way those base prices don’t cover the cost of food, staff and overheads.

    then they have the gall to charge a “service charge” to pay the staff.

    THEN they have the gall to imply you still need to tip

    fuck that to hell

    PhlubbaDubba ,

    That’s not implying anything that’s just listing the amount that any given percentage would be if you want to tip the waiter specifically, you might notice that all the percentages are below what’s seen as the base for a good tip, save the 15% which is just at it depending on where you’re eating at.

    The service charge is for the pool for all the staff while the tip on this one is actually a good service reward since they adjusted price to facilitate a better wage, like they literally said at the bottom of the stub.

    Marin_Rider ,

    absolute crazy bullshit. don’t stand for that. restaurant price here what you see is what you pay. no stupid surcharges and no stupid tipping. fuck all that

    PhlubbaDubba ,

    Literally you’re being amgy that they told you money was going to the workers

    Marin_Rider ,

    spoiler: it’s not

    join the first world and just pay them properly without all your fancy extra charges

    KneeTitts ,
    @KneeTitts@lemmy.world avatar

    Or, you know maybe the owner could live without a 5th cottage possibly?? naaaaaaa

    SeaJ ,

    That would be the ‘take a hit to profits.’ Yeah, I don’t expect that either. What’s annoying is that it is always the very profitable douche bag restaurants that do this. Most restaurants struggle to make ends meat.

    TotalFat ,

    The real crime here is $125 for bread and pasta…

    LemmyFeed ,

    And almost $5 for drip coffee

    SpaceNoodle , (edited )

    And yet only $6 for a beer

    Edit: downvotes from dim bulbs who can’t divide 12 by 2

    SpaceNoodle ,

    $16.25 for each “kids shells”

    pete_the_cat ,

    I was gonna say “The real crime is $11 for a fucking cannoli”. I could get two, large, freshly made cannolis in downtown NYC for about $7.

    SpaceNoodle , (edited )

    You can also get a slice for $3. It’s about supply and demand.

    Edit: downvotes from hermits who don’t understand that things cost different prices in different places

    pete_the_cat ,

    You could get a slice for $1, it won’t be fancy and served with a fresh cannoli though (they served both, a slice was like $4 and it was huge)

    Bonehead , (edited )

    The service charge is not a tip or gratuity, and is an added fee controlled by the restaurant that helps subsidize the staff wages so that management doesn't have to while still seeming to have reasonable prices on the menu. Also, management takes a cut as it subsidizes their wages too.

    Edit: I get why this upsets some people, but the downvote button is not a disagree button. I merely restated the restaurant's explanation in plain language. I'm not agreeing with it...

    cerevant ,

    If you charge me for service, I’m not paying extra for service.

    Call it what it is - a junk fee so they can make their prices look lower than they are. I wouldn’t go to this restaurant a second time.

    MxM111 ,

    The cost of food in American restaurants includes service charger. It just not itemized. Waiters do have salaries, so it comes from somewhere.

    cerevant ,

    That’s my point. This restaurant is try to bait and switch their customers by giving a misleading food price and adding a service charge. It is like a cell phone company adding garbage fees.

    As for my initial comment - if you add a percentage for service, that ends my obligation to tip.

    MxM111 ,

    Ah! I see. You were talking exclusively about not coming back into US restaurant, not restaurant in general anywhere in the world. It was not clear for me.

    squaresinger ,

    Hey, look at our cheap food!

    Oh, btw, we didn’t tell you, but it’s actually 18% more expensive than the prices on the menu.

    Also, it’s $10 extra for the plates and silverware.

    And we also charge you for eating in as well, that’s another $10.

    And if you don’t tip on top of that, we get really angry.

    Please leave a 5 star review!

    MxM111 ,

    I was talking about service charge, not tips.

    SatansMaggotyCumFart ,

    American waiters get paid, Parisian ones do it for the pleasure of serving their fellow man.

    dan ,
    @dan@upvote.au avatar

    And we also charge you for eating in as well, that’s another $10.

    Some areas actually have different pricing for eating in vs taking out, as it’s treated differently by the tax laws. Some areas also tax differently based on if it’s cold or hot/cooked food, so a toasted sandwich costs a bit more than an untoasted one. Very small differences, though.

    squaresinger ,

    Yeah, my post was a bit of hyperbole, but I’ve been to a fancy restaurant a while ago, where they did make you pay for cutlery and also for the table separately.

    But they didn’t have a take-away option.

    NateNate60 ,

    By tradition, the service charge is supposed to be paid to the staff. Therefore, it’s not customary to tip when you’re assessed a service charge, although many restaurants choose to ask for a tip anyway.

    If you work in a restaurant that charges a service charge but pockets it… you’re being robbed.

    BrandoGil ,

    Unfortunately, this isn’t true anymore. At least in PA.

    34 Pa. Code 231.114. Service charges.

    § 231.114 b

    The notice required by subsection (a) must state that the administrative charge is for administration of the banquet, special function or package deal and does not include a tip to be distributed to the employees who provided service to the guests.

    www.pacodeandbulletin.gov/Display/pacode?file=/se…

    Rivalarrival ,

    If this restaurant was passing the entire service charge to its waitstaff, it would be advantageous to call it a gratuity and exempt it from sales and income tax. The IRS does not tax tips/gratuities as income.

    By charging (state) sales tax on the service fee, they also have to declare it as revenue, which increases their income and thus their income tax. They have to pay a portion of that service fee in income tax, so they aren’t going to be passing the full amount to their waitstaff. The restaurant will be keeping the bulk of that service fee.

    Mango ,

    Heck, I wouldn’t even pay this restaurant the first time. I’m out. You ain’t making me pay extra after the fact.

    Gork ,

    subsidize the staff wages so that management doesn’t have to

    Yeah that’s a pretty shit reason to levy this fee unsuspectingly.

    ilikecoffee ,

    Sounds like it does much the same thing as tipping then, right? But then the receipt says you should pay the service charge and a tip on top 🤔

    I’m not American so maybe someone can explain this to me, haha…

    wolfpack86 ,

    It doesn’t make sense to any sane person. But basically:

    The restaurant feels that costs have increased and in order to remain profitable they must raise prices. Instead of raising prices on the menu, take the canoli as an example, from $11 to $13, they decided to add it after the calculation.

    This means the customer may go out with an idea of what they would like to spend (maybe it’s a special treat for them) orders based on the menu, figures tip and tax… Expects to be out for $100… But surprise! You owe a fucking service charge.

    Now-- I’m not into this particular restaurant’s finances. Let’s be generous and assume they need to charge more to break even. This is the shady (and should be illegal) way to do this. They should instead raise prices and be honest with the customer what they feel they need to charge.

    Wermhatswormhat ,

    The problem is, this is still decietful. If this is an issue then the correct move would be to make every item on the menu 18% more expensive as a base. Because now, they still get to say “oh well our prices are still low come eat here and get “X item” for “Y price” but that’s not true anymore because of the service charge. It’s just a way to keep menu items lower in price but increase the price at the end.

    kent_eh ,

    that helps subsidize the staff wages

    Allegedly

    But If that’s the reality, I feel no need to add a tip.

    Rivalarrival ,

    They probably pay $1/hr over minimum tipped wages. About $0.75 of that $17.22 fee goes to paying that increased wage, and the rest is pocketed.

    If they wanted to subsidize worker wages, they would include a mandatory gratuity rather than a service fee. Gratuities are passed directly to workers.

    This is truly scummy behavior.

    fishos ,
    @fishos@lemmy.world avatar

    Except you’re wrong. It is a tip because the tip is the service charge. The tip specifically is “we pay them less than minimum wage and your tip covered the rest of their service cost”. A tip AND a service charge, especially a service charge not levied because there were X+ people at the table, is double dipping on the tip. Both fees are for the same thing. Either increase prices or increase the tip(or pay your workers fairly and don’t expect me to subsidized the rest with these secret fees). Make them upfront and honest. This isn’t. This is a perfect invitation to say “you already charged me for the service, so no tip is needed, because that’s what it is for”.

    dan ,
    @dan@upvote.au avatar

    The tip specifically is "we pay them less than minimum wage

    Not everywhere. Some areas don’t allow wages that are lower than minimum wage for tipped jobs. The area I live in in California is around $17-18/hr minimum wage regardless of if the job is tipped or not.

    ReluctantMuskrat ,

    Except you’re wrong. Service charges are not considered tips under FLSA rules within the US. Many states and local jurisdictions have special rules for tipped wages, how they’re taxed and those taxes are collected, and service charges are not included in that definition.

    www.dov.gov/agencies/…/15-tipped-employees-flsa

    fishos ,
    @fishos@lemmy.world avatar

    Nice reading comprehension. The TIP is a service charge. You got that backwards buddy. So a service charge and a tip is service charge x2. Or you’re admitting that a tip is only for “above and beyond thanks”, in which case it’s not mandatory and this is again a scam.

    Rivalarrival ,

    A tip is money paid directly to the worker providing the service. The restaurant can’t keep any part of it. They are not taxed on it, either as sales tax or income tax. That money is only counted as income to the worker.

    This service fee was subject to sales tax. It will also be subject to income tax by the restaurant. The restaurant gets to keep as much of it as they want.

    “Mandatory gratuities” are tips that the restaurant obligates the customer pay to the waitstaff. Where these are charged, you are not allowed to stiff the waitstaff. The restaurant cannot keep any part of that gratuity.

    Tips/gratuities and service fees are not the same thing at all.

    fishos ,
    @fishos@lemmy.world avatar

    I’m not talking the law, I’m talking what the tip actually is in practice. It’s the service charge. You’re paying for the server to serve you. The tip isn’t for the food. It for the server serving. Just because you’ve been conned and guilted into accepting this as normal doesn’t make it right. And just because it’s taxed doesn’t mean it’s still not extra income to the resturaunt. Would it be ok if I mugged you but paid taxes on the money and gave it a cutesy name?

    Rivalarrival ,

    A “tip” is for the server serving.

    A “mandatory gratuity” is for the server serving.

    A “service fee” is for the restaurant existing. Service fees do not go directly to the staff. The restaurant keeps most of that service fee.

    I mentioned taxes not to suggest that the practice is legitimate, but to demonstrate that the money is income to the restaurant. Tips are not income to the restaurant. Tips are income only to the staff.

    I acknowledge that there is no significant distinction to the customer between a tip and a service fee, but there is a highly relevant distinction between the two for the restaurant and the server. The service fee this restaurant is charging is money stolen from its staff.

    This restaurant could support its workers by adding a mandatory gratuity to the bill, in which case I would agree that no tips should be paid. But a service charge is not a tip. A service charge is not a gratuity. A service charge is not paid to the servers. A service charge is kept by the restaurant.

    ReluctantMuskrat ,

    You might want to read it again

    Service Charges: A compulsory charge for service, for example, 15 percent of the bill, is not considered a tip under the FLSA. Sums distributed to employees from service charges are not tips, but may be used to satisfy the employer’s minimum wage and overtime pay obligations under the FLSA.

    A place implementing a service charge cannot classify it as a tip, even if it’s 100% passed onto the employee… a mandatory charge is not a tip, even if the restaurant encourages you to treat it that way. Certain states and jurisdictions tax tips differently than regular wages, and service charges are wages, not tips.

    Rivalarrival ,

    If they charged a mandatory gratuity, I would agree with you. An 18% mandatory gratuity is an 18% tip to the waitstaff; you are not expected to pay an additional tip on top of that.

    A tip is money directly to the waitstaff. The restaurant can’t touch it. The restaurant is not charged sales tax nor income tax on money collected as tips. When they collect a gratuity, it goes directly to the staff.

    This “service fee” was taxed. It did not go directly to the waitstaff; it was recorded as sales revenue, and thus income to the restaurant. The restaurant is being taxed on it before any of it gets to the staff. They would only do that if they are keeping a part of it, which they could not do if it was considered a “tip” or “gratuity”.

    Charging a “service fee” is a legal way for the restaurant to steal tips from employees, while making you think they are paying it to their staff.

    Most likely, they pay minimum tipped wage plus $1/hr. They are making $3.13/hr plus tips instead of $2.13/hr plus tips. That extra $1 is the higher “base wage” they are talking about.

    About $0.75 of that $17.22 service fee goes toward increasing the “base wage”, with the rest counted as income to the restaurant.

    This is not the perfect opportunity to say “you already charged me for the service”. This is the perfect opportunity to name and shame this scumbag restaurant for its shitty business practices, and never eat their again.

    XEAL ,

    The downvote button is a lazy disagree button, but people is also dumb.

    MisterFrog ,
    @MisterFrog@lemmy.world avatar

    In Australia this would be illegal drip pricing. JUST INCLUDE EVERYTHING IN THE PRICE OF THE FOOD! Is it so hard?

    Absolutely wild you also don’t add tax in the price in the US.

    Is it too much to ask to just be told the price upfront on the menu?

    Kolanaki ,
    @Kolanaki@yiffit.net avatar

    If the service charge is so they can pay the employees better, I guess they don’t need a tip on top of that unless they went above and beyond their basic duties. Like what a tip should be for

    bmsok ,

    The entire service fee thing is fraud at this point. Undercutting wages and skimming profits for owners off the backs of their employees.

    I know it’s been happening forever but this shit has been escalating exponentially.

    HawlSera ,

    It’s to make you mad at their employees

    Kolanaki ,
    @Kolanaki@yiffit.net avatar

    It’s failing. I’m just mad at the employer.

    HawlSera ,

    Because you’re not a moron.

    This is for Fox News watching Grannies to look at and go “Them libruls are making my food expensice because dey don’t wanna git no jerbs”

    roofuskit ,

    Kids shells are $16 each? Fuck this place.

    test1 ,
    @test1@calendario-lunar.com avatar

    What are "kids shells"?

    CC: @YoBuckStopsHere

    T00l_shed ,

    Likely a kids pasta shell dish.

    UnderpantsWeevil ,
    @UnderpantsWeevil@lemmy.world avatar

    Yeah, it looks like this person just went to an overpriced restaurant.

    Dining at the Ritz and then throwing a fit over your bill is… idk, man. Maybe you should have walked out before ordering a $6 glass of lemonade.

    WhipTheLlama ,

    Restaurant: $11 cannelloni and $6 beer.

    Lemmy: fuck the rich for paying these high prices!

    sanguine_artichoke ,
    @sanguine_artichoke@midwest.social avatar

    That’s not the point though… it’s that everything is 18% more than advertised on the menu, regardless of whether the original price was high or fair.

    UnderpantsWeevil ,
    @UnderpantsWeevil@lemmy.world avatar

    it’s that everything is 18% more than advertised on the menu

    More than that if you factor in sales taxes. Or “valet only”. Nevermind tip.

    Definitely qualifies as mildly infuriating, but this sort of bullshit surcharge is standard fair for upscale retail in the service sector.

    Wirrvogel ,

    Germany:

    Price indication regulation (Preisangabenverordnung)

    All prices stated on the menu must include any applicable surcharges. In other words, the price of the meal is also the final price. The quantity served must also be stated for drinks.

    Witchfire ,
    @Witchfire@lemmy.world avatar

    I’m honestly surprised the percentage options they offer are so low. In NYC they start at 20%, and usually go 20% 25% 30%. I’ve even seen them start at 22%

    bi_tux ,
    @bi_tux@lemmy.world avatar

    Besides from a extra fee (which would be illegal in my country), who tf could afford 32$+18%+taxes for two bowls of pasta? At my local italian restaurant you get 2 bowls spagethi for 20€ (including taxes)

    TheBERFA ,

    A kids size no less. Actually insane.

    iAvicenna ,
    @iAvicenna@lemmy.world avatar

    The OP should have shared the restaurant, what a dick head of an owner

    MrBusiness ,

    $11 for a cannoli? Gotta lotta nerve with that price!

    KneeTitts ,
    @KneeTitts@lemmy.world avatar

    To be honest restaurants became so expensive so long ago that we just stopped going to them. I cant even remember when that was, but it was more than 5 years ago for sure. And things sound like theyve gotten a lot worse since then so I cant see us ever going back.

    Craftkorb ,

    It’s crazy how it’s your job to pay the workers when you’re not employing them. Just put the damn living wage into the price of the food, there, done. I’m going to a restaurant to eat stuff, not to haggle the worth of someone’s work.

    MalachaiConstant ,

    But but but if customers know how much it’s going to cost ahead of time, they might decide to go somewhere else!

    aidan ,

    Well you are employeeing them, in that you’re exchanging your money for the product of their labor, it just passes through a few hands to get to them.

    sanguine_artichoke ,
    @sanguine_artichoke@midwest.social avatar

    I’ve been to a couple places in Denver that do this and obviously it’s bullshit. Just raise the prices! Not 18%, though, they’re 5% and started when everyone felt bad for restaurant workers during Covid. At both of them they had a disclaimer “if you disagree with this charge, we will gladly remove it”… as if that’s a comfortable thing to do to save $4.

    droans ,

    I get mandatory tips on large parties as long as the policy is made clear before ordering. But like you said, service charges are ridiculous and so are mandatory tips for small groups.

    bi_tux ,
    @bi_tux@lemmy.world avatar

    Capitalists when 10% taxes vs capitalists when 18% fee

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